Peremptory orders of the ICC arbitral Tribunal
A peremptory order is an order granted by an arbitral tribunal against a party which has failed to comply with an earlier order of the tribunal to the same effect.[1] The party subject to the peremptory order must comply within the time prescribed or otherwise within a reasonable time.[2] Under s. 42 of the English Arbitration Act 1996 (“s. 42”), the court can make an order requiring a party to comply with a peremptory order. This can be on an application by the tribunal (on notice to the parties) or, as in the present case, by a party to the arbitration with the tribunal’s permission. Prior to the decision discussed, s. 42 had been used essentially in relation to procedural and cost matters only.
In this Court of Appeal case, LLC Eurochem North-West-2 v Tecnimont S.P.A and MT Russia LLC,[3] the respondents had commenced a London-seated ICC arbitration against the Russian appellant, arising from a project affected by EU sanctions. The Russian appellant relied on a Russian law which granted exclusive jurisdiction to Russian arbitral courts in sanctions-related arbitral matters and commenced litigation in Russia. In this Russian action, it sought judgment on the amount it counterclaimed in the arbitration and anti-arbitration injunctions.
The arbitral Tribunal ordered the Russian appellant – i.e., the respondent in the arbitration – to withdraw the parallel Russian proceedings and the anti-arbitration proceedings. After the respondent breached these orders, the Tribunal issued a procedural order wherein it noted the breach and made peremptory orders that the respondent should withdraw these proceedings, fixing a deadline for the same. Neither this nor further, related peremptory orders were complied with by the respondent.
High Court decision
Given the respondent’s conduct, the claimants in the arbitration made an application in the Commercial Court seeking orders to enforce the Tribunal’s procedural orders pursuant to s. 42. This was later amended to add s. 37 of the Senior Courts Act (the most common basis for seeking interim relief in English courts) as an alternative basis for the order sought from the Court. By way of injunction, the Judge granted the orders, endorsed with a penal notice, requiring that the appellant immediately withdraw the two Russian proceedings.
The High Court Judge found that:
- parties have a duty to do all things “necessary for the proper and expeditious conduct” of the arbitration, including complying with “any order or directions of the tribunal” (art. 40(2)(a) of the Arbitration Act). It follows from this wording that where any order is made by a tribunal, compliance with it is to be treated as necessary for the proper and expeditious conduct of the arbitration (Pearl Petroleum[4] followed);
- the requested order was to give effect not just to a negative obligation not to commence foreign proceedings, but also to a positive obligation to comply with an order of the Tribunal. In those circumstances, the order sought was different to a s. 44 application (which may be limited to s. 37 SCA as a basis for anti-suit relief[5]).
Court of Appeal decision
This decision was upheld by the Court of Appeal which disagreed with the appellant that orders under ss. 41 and 42 of the Arbitration Act 1996 are concerned with a party’s conduct of the arbitral reference (an internal matter) only, as opposed to the pursuit of different proceedings in a different forum (an external matter). The Court rejected this internal/external distinction and held that, as a matter of law, the broad wording (“any orders or directions of the tribunal”) of s. 41(5) “allows a peremptory order to be made for any failure to comply with an order or directions of the tribunal, whether or not necessary for the proper and expeditious conduct of the arbitration, subject only to the possible qualification that the order or directions must be ones which the tribunal had power to make”.[6]
The Court added that “in any event”, as a matter of fact (although the appeal was only on the previous point of law), the anti-suit relief in question was “capable of being necessary for the proper and expeditious conduct of the arbitration”, giving examples of how parallel proceedings might divert time, resources and attention from the arbitration, or jeopardize the enforcement of the award.[7] Similarly, anti-anti-arbitration relief was to prevent the arbitration from being affected (in that case, by an injunction against the arbitration).[8]
Commentary
It is noteworthy that it was not appealed that art. 28 of the ICC rules – providing that “the arbitral tribunal may, at the request of a party, order any interim or conservatory measure it deems appropriate” – granted the Tribunal jurisdiction to make the original anti-suit order.
Overall, the decision is a welcome confirmation of the enforceability of anti-parallel proceedings, and anti-anti-arbitration, peremptory orders made by English-seated arbitral tribunals under the ICC Rules. English judges of course still have discretion as to whether to make orders pursuant to s. 42, and in appropriate circumstances it may make more sense for a party to seek a court order directly. Nevertheless, the decision makes clear that peremptory orders, issued by an arbitral tribunal under the ICC Rules and aimed at proceedings which seek to derail a validly initiated arbitration, have teeth.
[1] Section 41(5) of the Arbitration Act 1996.
[2] Section 42 of the Arbitration Act 1996. Note a peremptory order, and an application to the court for its enforcement, may also be made by an emergency arbitrator under s. 42 of the Arbitration Act 1996.
[3] [2026] EWCA Civ 5.
[4] Pearl Petroleum Company Ltd v Kurdistan Regional Government of Iraq [2015] EWHC 3361 (Comm).
[5] This potential caveat was based on obiter remarks by Lord Mance in AES Ust-Kamenogorsk Hydropower Plant LLP v Ust-Kamenogorsk Hydropower Plant JSC [2013] UKSC 35 [2013] 1 WLR 1889, para. 48, and was a position with which the Court of Appeal expressed disagreement provided an arbitration was already taking place (as opposed to merely being in prospect or not even being intended to be brought) – see para. 63.
[6] Court of Appeal Judgment, para. 47.
[7] Court of Appeal Judgment, paras. 48 and 56-57.
[8] Court of Appeal Judgment, para. 55.